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Note 12 - Agreements

9 Months Ended

Sep. 30, 2025

Notes to Financial Statements

Collaborative Arrangement Disclosure [Text Block]

12. Agreements

J.D. Heiskell Working Capital Agreements. Pursuant to a Corn Procurement and Working Capital Agreement with J.D. Heiskell, AAFK procures whole yellow corn from J.D. Heiskell. AAFK has the ability to obtain grain from other sources subject to certain conditions; however, in the past all AAFK grain purchases have been from J.D. Heiskell. Title to and risk of loss of the corn pass to AAFK when the corn is deposited into the Keyes Plant weigh bin. Pursuant to a separate agreement entered in May 2023, J.D. Heiskell also purchases all of our ethanol, WDG, corn oil, and CDS and sells them to marketing companies designated by us. We have designated Murex to purchase and market ethanol and A.L. Gilbert to purchase and market WDG and corn oil. Our relationships with J.D. Heiskell, Murex, and A.L. Gilbert are well established, and we believe that the relationships are beneficial to all parties involved in utilizing the distribution logistics, reaching a widespread customer base, managing inventory, and providing working capital relationships.

The following table summarizes the J.D. Heiskell purchase and sales activity during the three and nine months ended September 30, 2025 and 2024:

		*For the three months ended September 30,*								*For the nine months ended September 30,*
		*2025*				*2024*				*2025*				*2024*
Ethanol sales		$	31,252			$	32,812			$	87,035			$	87,635
Wet distiller's grains sales			7,305				8,961				23,133				27,476
Corn oil sales			1,949				1,746				4,900				4,199
CDS sales			24				24				39				49
Corn purchases			29,761				33,170				91,050				97,489

		*September 30, 2025*				*December 31, 2024*
Accounts receivable			122				25

The agreements with J.D. Heiskell, Murex, and A.L. Gilbert include marketing and transportation services. For the three months ended September 30, 2025 and 2024, we expensed marketing costs of $0.6 million and $0.7 million, respectively, in connection with the marketing arrangements and these costs are included in Selling, General, and Administrative expenses. For the nine months ended September 30, 2025 and 2024, we expensed marketing costs of $1.8 million and $1.9 million, respectively. For the three months ended September 30, 2025, we expensed transportation costs of $1.2 million related to sales of ethanol and $1.4 million related to sales of WDG. For the nine months ended September 30, 2025, we expensed transportation costs of $3.5 million related to sales of ethanol and $4.1 million related to sales of WDG. For the three months ended September 30, 2024, we expensed $1.1 million related to sales of ethanol and $1.5 million related to sales of WDG. For the Nine months ended September 30, 2024, we expensed transportation costs of $2.6 million related to sales of ethanol and $4.4 million related to sales of WDG. Transportation costs are included in costs of goods sold.

Supply Trade Agreement. On July 1, 2022, UBPL entered into an operating agreement with Gemini Edibles and Fats India Private Limited (“Gemini”) pursuant to which Gemini supplies UBPL with feedstock up to a credit limit of $12.7 million and has a collateral interest in inventories, current assets, and fixed assets of UBPL. If UBPL fails to pay an invoice within the ten-day credit period, the outstanding balance bears interest at 18%. The agreement is effective through July 2026. As of September 30, 2025, and December 31, 2024, UBPL had accounts payable of none and $6.2 million respectively, under this agreement.

Forward Sale Commitments. As of September 30, 2025, we have no forward sale commitments.

Natural Gas Purchase Agreement. As of September 30, 2025, we have a forward purchase agreement in place to buy approximately 3,700 MMBtu of natural gas per day at a fixed price of $3.30 per MMBtu through March 2026. We have elected to apply the normal purchases and normal sales scope exception under ASC 815, hence the natural gas purchased under this agreement is accounted for and included as cost of goods sold in our financial statements.